Virtual Concerts A New Video Format

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The 20,000 Foot View: The global pandemic thrust the live music sector into chaos, with global revenues falling by        in 2020 compared to one year previously. The music industry was rocked by first-order impacts (no concerts, no fan engagement) and second-order impacts (many artists realising that streaming did not add up without live income alongside it). Necessity, though, is the mother of invention and an unprecedented period of innovation and experimentation followed, creating a whole new virtual concert ecosystem. One that presents great opportunity but that also reflects the flaws of a hastily constructed industry, flaws that must be fixed for the sector to realise its ambition. Rather than the future of live, virtual concerts represent an entire new video product strategy.

Key Insights

• The        pandemic thrust global live music revenues down by        from        billion in 2019 to        billion in 2020, disrupting artist income, in turn highlighting artist and songwriter discontents with streaming royalties
• Virtual events were kickstarted by the pandemic, with        million streams of virtual concerts in 2020 and with        of consumers regularly viewing live streams, albeit still less than half of the        that used to regularly attend real world concerts
• Live streaming quickly transitioned from free to paid, with Bandsintown reporting the number of paid live-streamed concerts posted on its platform up from        in        2020 to        by end November 2020
• Live streamed concert viewers are younger than traditional concert goers and more likely to be male        compared to       
• Live streaming was driven by a quantum leap in artist demand; home-bound consumers with        more time; a wider shift to streaming; and a widespread consumer desire to be connected
• The virtual concert value chain is defined by fragmentation and a vast array of companies trying to own as much of the value chain as possible 
• Live streaming needs more consistency and structure, with a strong case for a circuit of virtual venues, sophisticated monetisation and a distribution ecosystem
• Live streaming represents a new video format that could be to live music what TV is to sports: a lucrative, global, hybrid licensing / pay per view
• Ticketed live-streamed concerts generated        billion in 2020, which will grow to        billion in 2021        of all live revenues) and will reach        billion in 2027
• The outlook for virtual events will be defined by: contributing to diversified artist income; filling the small venue gap for emerging artists; delineating traditional artists from streaming artists; format and business evolution; and new games models

Companies and brands mentioned in this report: Amazon, Driift, Epic Games, Fortnite, Facebook, MelodyVR, Minecraft, Sessions, Twitch, YouTube